The residential real estate sector in India has once again proved to be a bright spot by contributing to the country’s overall GDP, thereby making the economy more vibrant and optimistic. As per NITI Aayog, India’s real estate market will reach $1 trillion by 2030 and account for 13% of its GDP by 2025, which illustrates the magnanimous streak of the sector.
Additionally, in its latest quarterly report, Knight Frank stated that 78,627 residential units were sold in India in the January-March 2022 quarter, despite the third wave of COVID-19 creating havoc across the country. The report further states that units priced above Rs 1 crore accounted for a quarter of sales. Despite the challenges posed by the Omicron variant, the year 2022 brought good news for India’s residential real estate market, breaking all previous records.
The first financial quarter of 2022 witnessed a growing demand for large homes as people sought spacious homes that could complement their multi-functional lifestyle. After the pandemic-induced lockdown, buyers have realized the importance of having a dedicated work and study space, including a leisure corner. Investing in extra rooms, chic interiors, balconies, gyms, modern kitchenettes, and smart devices is becoming a proclamation for their modern lifestyle. This trend is expected to grow substantially for the rest of the year. Additionally, budget homes in the medium-price category are expected to experience increased demand from homebuyers, placing them at the forefront of project launches. What’s more, luxury and ultra-luxury segments are also expected to witness increasing customer interest.
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The trend of integrated living will also gain ground in the residential sector as more buyers are gravitating towards projects that feature social infrastructure in close proximity, such as shopping areas, restaurants, multiplexes, schools, colleges, office buildings, clinics, and parks. The trend is picking up speed because homebuyers are now on the lookout for a more secure and peaceful life.
In addition, 2022 is proving to be a great year for NRIs purchasing homes due to the combined effects of low interest rates on home loans, excellent offers, affordable prices and the rupee depreciation in recent times. Due to various reasons such as capital appreciation, growing awareness about the need for open spaces, and the preference for privacy, the demand for plotted developments and floors has increased steadily in recent quarters. As demand grows, more well-organized developers are seen to enter the planned development sector.
Residential real estate has not only become a favorite choice of investors but has also become a backbone of the country’s economic recovery and prosperity. India’s residential real estate sector is increasingly embracing new concepts and innovative solutions to meet the needs of Millennial home buyers who are enthusiastic about homeownership. Additionally, due to government incentives for home buyers, strict rules & regulations, the market for residential real estate is flourishing by leaps and bounds, with more first-time home buyers entering the market.
Considering the current scenario, India’s residential real estate sector is experiencing a much-needed steady growth phase with direct impact on economic growth, better market opportunities, and increased investments.
(By Ashok Singh Jaunapuria, MD and CEO, SS Group)